Unfair Dismissal

Certain categories of employee have the right not to be dismissed unfairly. Certain qualifications are necessary:-

The employee must show that he is an employee – see separate note.

The employee must have at least two years of continuous employment unless the dismissal is for a number of reasons which are considered to be “automatically unfair”.

The employee must not fall into one of the limited number of excluded classes – for example share fishermen.

The employee must have been dismissed. This may take a number of forms:-

(a) The contract is terminated by the employer.(b) The employer fails to renew a fixed term contract.(c) The employee leaves because of a major breach of contract by the employer – known as constructive dismissal. Constructive dismissal claims are particularly difficult.There are detailed and complicated rules to calculate commencement and termination dates of employment and as to what amounts to continuity of employment. We recommend that you take specific advice.

The grounds for dismissal which are automatically unfair – these include reasons to do with Union membership, discrimination, pregnancy, health and safety or transfer of undertakings.

Grounds for dismissal

The following grounds for dismissal are potentially fair:-

Misconduct What amounts to misconduct will depend upon circumstances but might, for example, include poor attendance, theft, violence at work, insubordination and so on.

Redundancy - see separate page.

Capability This is inability to do the job, for example incompetence or ill health. In the case of illness great care is now required because of the potential impact of the Disability Discrimination Act provisions.

Illegality The inability of an employee to do the job without breaking the law – a good example perhaps being the loss of a driving licence to a professional driver.

Some other substantial reason This might include for example a fundamental re-organisation of a business causing changes in deployment of staff and individual contracts of employment.

Retirement Dismissal on the grounds of retirement will in some circumstances be fair.

An employer seeking to retire an employee on the grounds of retirement has a duty to notify the employee of the right to work beyond retirement – not more than 12 or less than 6 months before the intended retirement date. The employee has a right to request to work beyond this date and the employer has a duty to consider this request (including the duty to meet with the employee and discuss the matter and to provide a right of appeal).

Reasonableness In order for an employer to show that he has acted reasonably to dismiss for a potentially fair reason the decision to dismiss must also fall within a range of decisions that a reasonable employer could make. However the tribunal does not simply substitute their own view of fairness for that of the employer.

In order to demonstrate a reasonableness an employer should:-

(a) Raise any issues (for example a misconduct) with the employee promptly as they arise.(b) Provide the employee with a fair hearing (time to prepare, advocate and an opportunity to state his case).(c) Act proportionately giving employees an opportunity to improve and assistance with this where appropriate. Provide a penalty commensurate to the wrong – for example giving warnings.(d) Provide a right to an appeal.There is now a statutory obligation to follow disciplinary and grievance procedures. It is vital that any procedures which the employer has in a Staff Handbook or contract of employment are fully adhered to. Failure to comply with statutory disciplinary procedures may render an otherwise potentially fair dismissal automatically unfair.

Written reasons for dismissal An employee who has been employed for more than two years is entitled to be notified in writing of the reasons for their dismissal:-

The employer must respond within 14 days in writing to any request.

The employer must provide a simple summary of the reason for dismissal.

Time limits An application for unfair dismissal must be filed within three months of termination of employment or one month of the end of early conciliation. This is critical – the limit is rarely extended. Great care is needed.

Compensation In the event that a tribunal finds unfair dismissal it has discretion as to remedies. The tribunal can order re-instatement but rarely does. The most frequent remedy is compensation divided into:-

Basic award – calculated in the same way as statutory redundancy subject to a maximum of £14,370.

Compensatory award – the amount which a tribunal considers just to compensate the employee for losses such as earnings (net pay), to include benefits, pension contributions and the like and expenses arising from dismissal. The maximum possible compensatory award is £78,962 (or 12 months gross pay if less). It can be reduced by up to 100% due to contributory fault on the part of the employee. The employee has a duty to mitigate their loss, so must seek alternative employment as soon as possible.

Certain claims that can be made to a tribunal such as discrimination, health & safety or “whistle blowing” are not subject to the limits mentioned.

Claims to a tribunal. From the 6th may 2014 no claim can be made to an employment tribunal without an ACAS certificate to show that early conciliation has been attempted.

Fees. Fees must now be paid when commencing a claim or applying for a hearing.